Auditing and Assurance Services A Systematic Approach 10th Edition Messier Test Bank
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About This Presentation
Auditing and Assurance Services A Systematic Approach 10th Edition Messier Test Bank
Auditing and Assurance Services A Systematic Approach 10th Edition Messier Test Bank
Auditing and Assurance Services A Systematic Approach 10th Edition Messier Test Bank
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6-1
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
Chapter 06
Internal Control in a Financial Statement Audit
True / False Questions
1. The concept of internal control includes IT systems and manual systems.
True False
2. The auditor must understand internal control before assessing inherent risk.
True False
3. The extent of an entity's use of IT can affect any of the components of internal control.
True False
4. One of the risks associated with internal control from IT is potential loss of data.
True False
5. Internal control consists of six components.
True False
6. Internal control includes monitoring of controls.
True False
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
Chapter 06
Internal Control in a Financial Statement Audit
True / False Questions
1. The concept of internal control includes IT systems and manual systems.
True False
2. The auditor must understand internal control before assessing inherent risk.
True False
3. The extent of an entity's use of IT can affect any of the components of internal control.
True False
4. One of the risks associated with internal control from IT is potential loss of data.
True False
5. Internal control consists of six components.
True False
6. Internal control includes monitoring of controls.
True False
6-2
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
7. A reliance strategy is used when control risk has been set at high.
True False
8. A substantive strategy is used when control risk has been set at high.
True False
9. Once a level of control risk has been established, it cannot be changed.
True False
10. Tests of controls must be performed if control risk is set at a lower level.
True False
Multiple Choice Questions
11. A primary purpose of internal controls is to
A. Form a basis for evaluating employees.
B. Monitor production quality.
C. Avoid clerical errors.
D. Meet objectives of maintaining reliable documents and records and accurate financial reporting.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
7. A reliance strategy is used when control risk has been set at high.
True False
8. A substantive strategy is used when control risk has been set at high.
True False
9. Once a level of control risk has been established, it cannot be changed.
True False
10. Tests of controls must be performed if control risk is set at a lower level.
True False
Multiple Choice Questions
11. A primary purpose of internal controls is to
A. Form a basis for evaluating employees.
B. Monitor production quality.
C. Avoid clerical errors.
D. Meet objectives of maintaining reliable documents and records and accurate financial reporting.
6-3
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
12. Internal controls are not designed to provide reasonable assurance that
A. Transactions are executed in accordance with management's authorization.
B. Embezzlement will be eliminated.
C. Access to assets is permitted only in accordance with management's authorization.
D. Amounts recorded for assets are compared with the actual existing assets at reasonable intervals.
13. The basic concept of internal control that recognizes the cost of internal control should not exceed the
benefits expected to be derived is known as
A. Reasonable assurance.
B. Management responsibility.
C. Limited liability.
D. Management by exception.
14. An auditor would most likely be concerned with internal control policies and procedures that provide
reasonable assurance about the
A. Efficiency of management's decision-making process.
B. Appropriate prices that the entity should charge for its products.
C. Methods of assigning production tasks to employees.
D. Entity's ability to accurately process and summarize financial data.
15. Management's attitude toward aggressive financial reporting and its emphasis on meeting projected
profit goals most likely would significantly influence an entity's control environment when
A. External policies established by parties outside the entity affect its accounting practices.
B. Management is dominated by one individual.
C. Internal audit personnel have direct access to the board of directors and the entity's management.
D. The audit committee is active in overseeing the entity's financial reporting policies.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
12. Internal controls are not designed to provide reasonable assurance that
A. Transactions are executed in accordance with management's authorization.
B. Embezzlement will be eliminated.
C. Access to assets is permitted only in accordance with management's authorization.
D. Amounts recorded for assets are compared with the actual existing assets at reasonable intervals.
13. The basic concept of internal control that recognizes the cost of internal control should not exceed the
benefits expected to be derived is known as
A. Reasonable assurance.
B. Management responsibility.
C. Limited liability.
D. Management by exception.
14. An auditor would most likely be concerned with internal control policies and procedures that provide
reasonable assurance about the
A. Efficiency of management's decision-making process.
B. Appropriate prices that the entity should charge for its products.
C. Methods of assigning production tasks to employees.
D. Entity's ability to accurately process and summarize financial data.
15. Management's attitude toward aggressive financial reporting and its emphasis on meeting projected
profit goals most likely would significantly influence an entity's control environment when
A. External policies established by parties outside the entity affect its accounting practices.
B. Management is dominated by one individual.
C. Internal audit personnel have direct access to the board of directors and the entity's management.
D. The audit committee is active in overseeing the entity's financial reporting policies.
6-4
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
16. Management philosophy and operating style most likely would have a significant influence on an
entity's control environment when
A. The internal audit function reports directly to management.
B. Management is dominated by one individual.
C. Accurate management job descriptions delineate specific duties.
D. The audit committee actively oversees the financial reporting process.
17. Proper monitoring within an internal control framework may include all of the following except:
A. An external auditor.
B. An effective audit committee.
C. An internal audit function.
D. The internal revenue service.
18. An entity's control activities include all of the following except:
A. Performance reviews.
B. Information processing.
C. External auditor's tests of controls.
D. Segregation of duties.
19. Potential benefits of an entity's controls in an IT environment include all of the following except:
A. Reduction in the risk that controls will be circumvented.
B. More accurate accounting estimates.
C. Consistent application of predefined business rules.
D. More timely information.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
16. Management philosophy and operating style most likely would have a significant influence on an
entity's control environment when
A. The internal audit function reports directly to management.
B. Management is dominated by one individual.
C. Accurate management job descriptions delineate specific duties.
D. The audit committee actively oversees the financial reporting process.
17. Proper monitoring within an internal control framework may include all of the following except:
A. An external auditor.
B. An effective audit committee.
C. An internal audit function.
D. The internal revenue service.
18. An entity's control activities include all of the following except:
A. Performance reviews.
B. Information processing.
C. External auditor's tests of controls.
D. Segregation of duties.
19. Potential benefits of an entity's controls in an IT environment include all of the following except:
A. Reduction in the risk that controls will be circumvented.
B. More accurate accounting estimates.
C. Consistent application of predefined business rules.
D. More timely information.
6-5
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
20. An entity's IT infrastructure refers to
A. Hardware components.
B. Programmers.
C. Software.
D. Data provided by the system.
21. Auditors are most likely to gather audit evidence solely using substantive procedures
A. If transactions are recurring.
B. For nonrecurring, unusual transactions.
C. If control risk is very low.
D. If the entity has a well-designed automated system.
22. Proper segregation of functional responsibilities in an effective system of internal control calls for
separation of the functions of
A. Authorization, execution, and payment.
B. Authorization, recording, and custody.
C. Custody, execution, and reporting.
D. Authorization, payment, and recording.
23. Factors that the auditor should consider as increasing the effectiveness of the audit committee
include all of the following except whether:
A. It is independent of management.
B. It is comprised almost exclusively of members of management, ensuring detailed knowledge of the
company's operations.
C. It asks management difficult questions.
D. It interacts regularly with internal audit personnel.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
20. An entity's IT infrastructure refers to
A. Hardware components.
B. Programmers.
C. Software.
D. Data provided by the system.
21. Auditors are most likely to gather audit evidence solely using substantive procedures
A. If transactions are recurring.
B. For nonrecurring, unusual transactions.
C. If control risk is very low.
D. If the entity has a well-designed automated system.
22. Proper segregation of functional responsibilities in an effective system of internal control calls for
separation of the functions of
A. Authorization, execution, and payment.
B. Authorization, recording, and custody.
C. Custody, execution, and reporting.
D. Authorization, payment, and recording.
23. Factors that the auditor should consider as increasing the effectiveness of the audit committee
include all of the following except whether:
A. It is independent of management.
B. It is comprised almost exclusively of members of management, ensuring detailed knowledge of the
company's operations.
C. It asks management difficult questions.
D. It interacts regularly with internal audit personnel.
6-6
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
24. The documentation of an auditor's understanding of internal controls
A. Is optional.
B. Must be exclusively in narrative, questionnaires, or flowchart form.
C. Must include flowcharts.
D. Can include any combination of narratives, questionnaires, or flowcharts.
25. A well-prepared flowchart should make it easier for the auditor to
A. Prepare audit procedure manuals.
B. Prepare detailed job descriptions.
C. Perform walkthroughs.
D. Assess the degree of accuracy of financial data.
26. A flowchart is most frequently used by an auditor in connection with the
A. Preparation of generalized computer audit programs.
B. Review of the entity's internal controls.
C. Use of statistical sampling in performing an audit.
D. Performance of analytical procedures of account balances.
27. An advantage of using systems flowcharts to document information about internal control instead of
using internal control questionnaires is that systems flowcharts
A. Identify whether segregation of duties prevent collusion.
B. Provide a visual depiction of the entity's activities.
C. Indicate whether controls are operating effectively.
D. Reduce the need to observe the entity's employees performing routine tasks.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
24. The documentation of an auditor's understanding of internal controls
A. Is optional.
B. Must be exclusively in narrative, questionnaires, or flowchart form.
C. Must include flowcharts.
D. Can include any combination of narratives, questionnaires, or flowcharts.
25. A well-prepared flowchart should make it easier for the auditor to
A. Prepare audit procedure manuals.
B. Prepare detailed job descriptions.
C. Perform walkthroughs.
D. Assess the degree of accuracy of financial data.
26. A flowchart is most frequently used by an auditor in connection with the
A. Preparation of generalized computer audit programs.
B. Review of the entity's internal controls.
C. Use of statistical sampling in performing an audit.
D. Performance of analytical procedures of account balances.
27. An advantage of using systems flowcharts to document information about internal control instead of
using internal control questionnaires is that systems flowcharts
A. Identify whether segregation of duties prevent collusion.
B. Provide a visual depiction of the entity's activities.
C. Indicate whether controls are operating effectively.
D. Reduce the need to observe the entity's employees performing routine tasks.
6-7
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
28. Which of the following audit tests would be regarded as a test of controls?
A. Tests of the specific items making up the balance in a given general ledger account.
B. Tests comparing inventory pricing to vendors' invoices.
C. Tests of the signatures on canceled checks to the board of directors' authorizations.
D. Tests of the additions to property, plant, and equipment by physical inspections.
29. The independent auditor selects several transactions in each functional area and traces them through
the entire system, paying special attention to evidence about whether or not the control activities are
in operation. This is an example of a(n)
A. Analytical procedure.
B. Test of controls.
C. Substantive procedure.
D. Functional test.
30. To obtain evidential matter about control risk, an auditor selects tests from a variety of techniques
including
A. Inquiry.
B. Analytical procedures.
C. Calculation.
D. Confirmation.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
28. Which of the following audit tests would be regarded as a test of controls?
A. Tests of the specific items making up the balance in a given general ledger account.
B. Tests comparing inventory pricing to vendors' invoices.
C. Tests of the signatures on canceled checks to the board of directors' authorizations.
D. Tests of the additions to property, plant, and equipment by physical inspections.
29. The independent auditor selects several transactions in each functional area and traces them through
the entire system, paying special attention to evidence about whether or not the control activities are
in operation. This is an example of a(n)
A. Analytical procedure.
B. Test of controls.
C. Substantive procedure.
D. Functional test.
30. To obtain evidential matter about control risk, an auditor selects tests from a variety of techniques
including
A. Inquiry.
B. Analytical procedures.
C. Calculation.
D. Confirmation.
6-8
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
31. Which of the following procedures most likely would provide an auditor with evidence about whether
an entity's internal control is suitably designed to prevent or detect material misstatements?
A. Scanning the journals produced by the internal control system.
B. Performing analytical procedures using data aggregated at a high level.
C. Vouching a sample of transactions directly related to the controls.
D. Observing the entity's personnel applying the controls.
32. Reports on service organizations typically
A. Provide reasonable assurance that their financial statements are free of material misstatements.
B. Ensure that the entity will not have any misstatements in areas related to the service organization's
activities.
C. Ensure that the auditee is billed correctly.
D. Assess whether the service organization's controls are suitably designed to achieve internal
control objectives.
33. Where computer processing is used in significant accounting applications, internal control activities
may be defined by classifying control activities into two types: general and
A. Administrative.
B. Specific.
C. Application.
D. Authorization.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
31. Which of the following procedures most likely would provide an auditor with evidence about whether
an entity's internal control is suitably designed to prevent or detect material misstatements?
A. Scanning the journals produced by the internal control system.
B. Performing analytical procedures using data aggregated at a high level.
C. Vouching a sample of transactions directly related to the controls.
D. Observing the entity's personnel applying the controls.
32. Reports on service organizations typically
A. Provide reasonable assurance that their financial statements are free of material misstatements.
B. Ensure that the entity will not have any misstatements in areas related to the service organization's
activities.
C. Ensure that the auditee is billed correctly.
D. Assess whether the service organization's controls are suitably designed to achieve internal
control objectives.
33. Where computer processing is used in significant accounting applications, internal control activities
may be defined by classifying control activities into two types: general and
A. Administrative.
B. Specific.
C. Application.
D. Authorization.
6-9
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
34. Which of the following input controls is a numeric value computed to provide assurance that the
original value has not been altered in construction or transmission?
A. Hash total.
B. Parity check.
C. Encryption.
D. Check digit.
35. General controls include all of the following except:
A. Organizational controls.
B. Data validation controls.
C. Access security controls.
D. Application system acquisition controls.
36. A limit test is a
A. Test to ensure that a numerical value does not exceed some predetermined value.
B. Check to ensure that the value in a field falls within an allowable range of values.
C. Check to ensure that the data in a field have the proper arithmetic sign.
D. Check on a field to ensure that it contains either all numeric or alphabetic characters.
37. A field test is a
A. Test to ensure that a numerical value in a field does not exceed some predetermined value.
B. Check to ensure that the value in a field falls within an allowable range of values.
C. Check to ensure that the data in a field have the proper arithmetic sign.
D. Check on a field to ensure that it contains either all numeric or all alphabetic characters.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
34. Which of the following input controls is a numeric value computed to provide assurance that the
original value has not been altered in construction or transmission?
A. Hash total.
B. Parity check.
C. Encryption.
D. Check digit.
35. General controls include all of the following except:
A. Organizational controls.
B. Data validation controls.
C. Access security controls.
D. Application system acquisition controls.
36. A limit test is a
A. Test to ensure that a numerical value does not exceed some predetermined value.
B. Check to ensure that the value in a field falls within an allowable range of values.
C. Check to ensure that the data in a field have the proper arithmetic sign.
D. Check on a field to ensure that it contains either all numeric or alphabetic characters.
37. A field test is a
A. Test to ensure that a numerical value in a field does not exceed some predetermined value.
B. Check to ensure that the value in a field falls within an allowable range of values.
C. Check to ensure that the data in a field have the proper arithmetic sign.
D. Check on a field to ensure that it contains either all numeric or all alphabetic characters.
6-10
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
38. An auditor's primary consideration regarding an entity's internal controls is whether the policies and
procedures
A. Affect the financial statement assertions.
B. Prevent management override.
C. Relate to the control environment.
D. Reflect management's philosophy and operating style.
39. In evaluating internal control, the auditor is basically concerned that the system provides reasonable
assurance that
A. Operational efficiency has been achieved in accordance with management plans.
B. Errors and fraud have been prevented, or detected and corrected.
C. Controls have not been circumvented by collusion.
D. Management cannot override the system.
40. Of the following statements about an internal control system, which one is correct?
A. The maintenance of the system of internal control is an important responsibility of the internal audit
function.
B. Administrative controls relate directly to the safeguarding of assets.
C. Because of the cost/benefit relationship, tests of controls may be applied on a test basis in some
circumstances.
D. Well designed internal control activities always prevent collusion among employees.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
38. An auditor's primary consideration regarding an entity's internal controls is whether the policies and
procedures
A. Affect the financial statement assertions.
B. Prevent management override.
C. Relate to the control environment.
D. Reflect management's philosophy and operating style.
39. In evaluating internal control, the auditor is basically concerned that the system provides reasonable
assurance that
A. Operational efficiency has been achieved in accordance with management plans.
B. Errors and fraud have been prevented, or detected and corrected.
C. Controls have not been circumvented by collusion.
D. Management cannot override the system.
40. Of the following statements about an internal control system, which one is correct?
A. The maintenance of the system of internal control is an important responsibility of the internal audit
function.
B. Administrative controls relate directly to the safeguarding of assets.
C. Because of the cost/benefit relationship, tests of controls may be applied on a test basis in some
circumstances.
D. Well designed internal control activities always prevent collusion among employees.
6-11
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
41. The concept of reasonable assurance in the context of an entity's internal controls recognizes that
A. Auditors may fail to detect material misstatements.
B. Proper internal controls guarantee that material misstatements will not occur.
C. Proper internal controls preclude fraud.
D. The costs of some controls may be too high to implement in relation to potential benefits.
42. An effective control environment
A. Allows management to identify all relevant risks.
B. Creates a commitment to competence.
C. Guarantees that all controls are followed as prescribed.
D. Requires an internal audit function.
43. The control environment component of internal control includes all of the following except:
A. Management's operating style.
B. Access to computer programs.
C. Organizational structure.
D. Human resource policies and practices.
44. Information and communication includes all of the following except:
A. Identifying and recording all valid transactions.
B. Determining the time period in which transactions occurred.
C. Communicating price changes to customers.
D. Properly presenting transactions and related disclosures in the financial statements.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
41. The concept of reasonable assurance in the context of an entity's internal controls recognizes that
A. Auditors may fail to detect material misstatements.
B. Proper internal controls guarantee that material misstatements will not occur.
C. Proper internal controls preclude fraud.
D. The costs of some controls may be too high to implement in relation to potential benefits.
42. An effective control environment
A. Allows management to identify all relevant risks.
B. Creates a commitment to competence.
C. Guarantees that all controls are followed as prescribed.
D. Requires an internal audit function.
43. The control environment component of internal control includes all of the following except:
A. Management's operating style.
B. Access to computer programs.
C. Organizational structure.
D. Human resource policies and practices.
44. Information and communication includes all of the following except:
A. Identifying and recording all valid transactions.
B. Determining the time period in which transactions occurred.
C. Communicating price changes to customers.
D. Properly presenting transactions and related disclosures in the financial statements.
6-12
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
45. An organizational structure is important for all of the following reasons except:
A. Ensuring proper accountability.
B. Defining areas of authority.
C. Creating clear lines of reporting.
D. Ensuring a proper commitment to controls.
46. The risk assessment component of internal control refers to
A. The auditor's assessment of control risk.
B. The auditor's assessment of client risk.
C. The entity's identification and analysis of risks relevant to achievement of its objectives.
D. The entity's monitoring of the potential for material misstatements.
47. As opposed to a manual control, an automated control
A. Can never be circumvented.
B. Should function consistently in the absence of program changes.
C. Need not be tested by the auditor.
D. Must be tested using the same techniques as a manual control.
48. An IT specialist is least likely to be necessary when
A. Data are shared extensively among systems.
B. The entity participates heavily in electronic commerce.
C. The system has not changed from the prior year.
D. Significant audit evidence is in electronic form.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
45. An organizational structure is important for all of the following reasons except:
A. Ensuring proper accountability.
B. Defining areas of authority.
C. Creating clear lines of reporting.
D. Ensuring a proper commitment to controls.
46. The risk assessment component of internal control refers to
A. The auditor's assessment of control risk.
B. The auditor's assessment of client risk.
C. The entity's identification and analysis of risks relevant to achievement of its objectives.
D. The entity's monitoring of the potential for material misstatements.
47. As opposed to a manual control, an automated control
A. Can never be circumvented.
B. Should function consistently in the absence of program changes.
C. Need not be tested by the auditor.
D. Must be tested using the same techniques as a manual control.
48. An IT specialist is least likely to be necessary when
A. Data are shared extensively among systems.
B. The entity participates heavily in electronic commerce.
C. The system has not changed from the prior year.
D. Significant audit evidence is in electronic form.
6-13
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Education.
49. In planning an audit of a new client, an auditor most likely would consider the methods used to
process accounting information because such methods
A. Influence the design of internal controls.
B. Affect the auditor's overall materiality levels.
C. Assist in evaluating the planned audit assertions.
D. Determine the auditor's acceptable level of audit risk.
50. A substantive strategy differs from a reliance strategy in that a substantive strategy includes
A. Increased implementation of detailed tests of transactions and balances.
B. Extra tests of controls.
C. Increased emphasis on verbal representations from management.
D. Setting control risk at a minimum level.
51. Which of the following statements concerning control risk is correct?
A. Assessing control risk and obtaining an understanding of an entity's internal controls may be
performed concurrently.
B. When control risk is high, an auditor is required to document the basis for that assessment.
C. Control risk may be assessed sufficiently low to eliminate substantive procedures for significant
accounts.
D. When assessing control risk, an auditor should not consider evidence obtained in prior audits
about the operation of control activities.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
49. In planning an audit of a new client, an auditor most likely would consider the methods used to
process accounting information because such methods
A. Influence the design of internal controls.
B. Affect the auditor's overall materiality levels.
C. Assist in evaluating the planned audit assertions.
D. Determine the auditor's acceptable level of audit risk.
50. A substantive strategy differs from a reliance strategy in that a substantive strategy includes
A. Increased implementation of detailed tests of transactions and balances.
B. Extra tests of controls.
C. Increased emphasis on verbal representations from management.
D. Setting control risk at a minimum level.
51. Which of the following statements concerning control risk is correct?
A. Assessing control risk and obtaining an understanding of an entity's internal controls may be
performed concurrently.
B. When control risk is high, an auditor is required to document the basis for that assessment.
C. Control risk may be assessed sufficiently low to eliminate substantive procedures for significant
accounts.
D. When assessing control risk, an auditor should not consider evidence obtained in prior audits
about the operation of control activities.
6-14
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Education.
52. Assessing control risk at a lower level most likely would involve
A. Changing the timing of substantive procedures by omitting interim testing and performing the tests
at year-end.
B. Identifying specific internal controls relevant to specific assertions.
C. Performing more extensive substantive procedures with larger sample sizes than originally
planned.
D. Reducing inherent risk for most of the assertions relevant to significant account balances.
53. In the audit of financial statements, an auditor's primary consideration regarding an internal control
policy or procedure is whether the policy or procedure
A. Reflects management's philosophy and operating style.
B. Affects management's financial statement assertions.
C. Provides adequate safeguards over access to assets.
D. Enhances management's decision-making processes.
54. Which of the following most likely would not be considered an inherent limitation of the potential
effectiveness of an entity's internal controls?
A. Incompatible duties.
B. Management override.
C. Mistakes in judgment.
D. Collusion among employees.
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Education.
52. Assessing control risk at a lower level most likely would involve
A. Changing the timing of substantive procedures by omitting interim testing and performing the tests
at year-end.
B. Identifying specific internal controls relevant to specific assertions.
C. Performing more extensive substantive procedures with larger sample sizes than originally
planned.
D. Reducing inherent risk for most of the assertions relevant to significant account balances.
53. In the audit of financial statements, an auditor's primary consideration regarding an internal control
policy or procedure is whether the policy or procedure
A. Reflects management's philosophy and operating style.
B. Affects management's financial statement assertions.
C. Provides adequate safeguards over access to assets.
D. Enhances management's decision-making processes.
54. Which of the following most likely would not be considered an inherent limitation of the potential
effectiveness of an entity's internal controls?
A. Incompatible duties.
B. Management override.
C. Mistakes in judgment.
D. Collusion among employees.
6-15
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Education.
55. It is important for the CPA to consider the competence of the entity's employees because their
competence bears directly and importantly upon the
A. Cost/benefit relationship of the system of internal control.
B. Achievement of the objectives of the system of internal control.
C. Comparison of recorded accountability with assets.
D. Timing of the tests to be performed.
56. As part of gaining an initial understanding of internal control, an auditor is required to do all of the
following except:
A. Consider factors that affect the risk of material misstatement.
B. Ascertain whether internal control policies and procedures have been placed in operation.
C. Identify the types of potential misstatements that can occur.
D. Obtain knowledge about the operating effectiveness of the internal control.
57. Effective internal control in a small company that has an insufficient number of employees to permit
proper division of responsibilities can best be enhanced by
A. Employment of temporary personnel to aid in the separation of duties.
B. Direct participation by the owner of the business in the recordkeeping activities of the business.
C. Engaging a CPA to perform monthly bookkeeping.
D. Delegation of full, clear-cut responsibility to each employee for the functions assigned to each.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
55. It is important for the CPA to consider the competence of the entity's employees because their
competence bears directly and importantly upon the
A. Cost/benefit relationship of the system of internal control.
B. Achievement of the objectives of the system of internal control.
C. Comparison of recorded accountability with assets.
D. Timing of the tests to be performed.
56. As part of gaining an initial understanding of internal control, an auditor is required to do all of the
following except:
A. Consider factors that affect the risk of material misstatement.
B. Ascertain whether internal control policies and procedures have been placed in operation.
C. Identify the types of potential misstatements that can occur.
D. Obtain knowledge about the operating effectiveness of the internal control.
57. Effective internal control in a small company that has an insufficient number of employees to permit
proper division of responsibilities can best be enhanced by
A. Employment of temporary personnel to aid in the separation of duties.
B. Direct participation by the owner of the business in the recordkeeping activities of the business.
C. Engaging a CPA to perform monthly bookkeeping.
D. Delegation of full, clear-cut responsibility to each employee for the functions assigned to each.
6-16
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Education.
58. The independent auditor should acquire an understanding of the internal audit function as it relates to
the assessment of control risk because
A. Internal audit programs, audit documents, and reports can eliminate the need for the independent
auditor's staff.
B. The procedures performed by the internal audit staff may eliminate the independent auditor's need
for an extensive study and evaluation of internal control.
C. The work performed by internal audit personnel may be a factor in determining the nature, timing,
and extent of the independent auditor's procedures.
D. The understanding of the internal audit function is an important substantive procedure to be
performed by the independent auditor.
59. In obtaining an understanding of an entity's internal control in a financial statement audit of a
nonpublic company, an auditor is not obligated to
A. Determine whether the control activities have been placed in operation.
B. Perform procedures to understand the design of the internal control policies.
C. Document the understanding of the entity's internal control components.
D. Search for significant deficiencies in the operation of the internal control.
60. After completing the preliminary phase of the review of internal control, the auditor decides not to rely
on the system to restrict substantive procedures. Documentation may be limited to the auditor's
A. Understanding of the internal control.
B. Reasons for deciding not to extend the review.
C. Basis for concluding that errors and fraud will be prevented.
D. Completed internal control questionnaire.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
58. The independent auditor should acquire an understanding of the internal audit function as it relates to
the assessment of control risk because
A. Internal audit programs, audit documents, and reports can eliminate the need for the independent
auditor's staff.
B. The procedures performed by the internal audit staff may eliminate the independent auditor's need
for an extensive study and evaluation of internal control.
C. The work performed by internal audit personnel may be a factor in determining the nature, timing,
and extent of the independent auditor's procedures.
D. The understanding of the internal audit function is an important substantive procedure to be
performed by the independent auditor.
59. In obtaining an understanding of an entity's internal control in a financial statement audit of a
nonpublic company, an auditor is not obligated to
A. Determine whether the control activities have been placed in operation.
B. Perform procedures to understand the design of the internal control policies.
C. Document the understanding of the entity's internal control components.
D. Search for significant deficiencies in the operation of the internal control.
60. After completing the preliminary phase of the review of internal control, the auditor decides not to rely
on the system to restrict substantive procedures. Documentation may be limited to the auditor's
A. Understanding of the internal control.
B. Reasons for deciding not to extend the review.
C. Basis for concluding that errors and fraud will be prevented.
D. Completed internal control questionnaire.
6-17
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Education.
61. In an audit of financial statements of a private company in accordance with generally accepted
auditing standards, an auditor is required to
A. Identify specific internal control activities relevant to management's financial statement assertions.
B. Perform tests of controls to evaluate the effectiveness of the entity's accounting system.
C. Determine whether procedures are suitably designed to prevent or detect material misstatements.
D. Document the auditor's understanding of the entity's internal control.
62. For a complex IT system, auditors are least likely to use which of the following when documenting
their understanding of internal controls?
A. Narratives.
B. Internal control questionnaires.
C. Flowcharts.
D. Organization charts.
63. Assessing control risk at a lower level involves all of the following except:
A. Identifying specific controls to rely on.
B. Concluding that controls are ineffective.
C. Performing tests of controls.
D. Analyzing the achieved level of control risk after performing tests of controls.
64. When an auditor increases the planned assessed level of control risk because certain control
activities were determined to be ineffective, the auditor would most likely increase the
A. Extent of tests of details.
B. Level of inherent risk.
C. Extent of tests of controls.
D. Level of detection risk.
Copyright © 2017 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
61. In an audit of financial statements of a private company in accordance with generally accepted
auditing standards, an auditor is required to
A. Identify specific internal control activities relevant to management's financial statement assertions.
B. Perform tests of controls to evaluate the effectiveness of the entity's accounting system.
C. Determine whether procedures are suitably designed to prevent or detect material misstatements.
D. Document the auditor's understanding of the entity's internal control.
62. For a complex IT system, auditors are least likely to use which of the following when documenting
their understanding of internal controls?
A. Narratives.
B. Internal control questionnaires.
C. Flowcharts.
D. Organization charts.
63. Assessing control risk at a lower level involves all of the following except:
A. Identifying specific controls to rely on.
B. Concluding that controls are ineffective.
C. Performing tests of controls.
D. Analyzing the achieved level of control risk after performing tests of controls.
64. When an auditor increases the planned assessed level of control risk because certain control
activities were determined to be ineffective, the auditor would most likely increase the
A. Extent of tests of details.
B. Level of inherent risk.
C. Extent of tests of controls.
D. Level of detection risk.
6-18
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Education.
65. Which of the following procedures most likely would be included as part of an auditor's tests of
controls?
A. Inspection.
B. Reconciliation.
C. Confirmation.
D. Analytical procedures.
66. An auditor is least likely to test the internal controls that provide for
A. Approval of the purchase and sale of marketable securities.
B. Classification of revenue and expense transactions by product line.
C. Segregation of the functions of recording disbursements and reconciling the bank account.
D. Comparison of receiving reports and vendors' invoices with purchase orders.
67. For certain controls, such as segregation of duties, documentary evidence may not exist. An auditor
would most likely test the procedures by
A. Reperformance and corroboration.
B. Observation and inquiry.
C. Inspection and vouching.
D. Confirmation and recomputation.
68. Walkthroughs usually involve all of the following audit procedures except:
A. Reperformance.
B. Inquiry.
C. Observation.
D. Inspection.
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Education.
65. Which of the following procedures most likely would be included as part of an auditor's tests of
controls?
A. Inspection.
B. Reconciliation.
C. Confirmation.
D. Analytical procedures.
66. An auditor is least likely to test the internal controls that provide for
A. Approval of the purchase and sale of marketable securities.
B. Classification of revenue and expense transactions by product line.
C. Segregation of the functions of recording disbursements and reconciling the bank account.
D. Comparison of receiving reports and vendors' invoices with purchase orders.
67. For certain controls, such as segregation of duties, documentary evidence may not exist. An auditor
would most likely test the procedures by
A. Reperformance and corroboration.
B. Observation and inquiry.
C. Inspection and vouching.
D. Confirmation and recomputation.
68. Walkthroughs usually involve all of the following audit procedures except:
A. Reperformance.
B. Inquiry.
C. Observation.
D. Inspection.
6-19
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Education.
69. Before applying substantive procedures to the details of accounts at an interim date (a date prior to
the balance sheet date), an auditor should
A. Assess control risk at high for the assertions embodied in the accounts selected for interim testing.
B. Determine that the accounts selected for interim testing are not material to the financial statements
taken as a whole.
C. Consider the availability of information at a later date that will be necessary for the auditor's
procedures (e.g., electronic data).
D. Obtain written representations from management that all financial records and related data will be
made available.
70. A high detection risk strategy includes all of the following except:
A. Interim testing.
B. Reduced testing of transactions.
C. Heavy reliance on analytical procedures as substantive procedures.
D. Audit work only completed at year-end.
71. The auditor should consider all of the following when deciding whether substantive procedures will be
performed at an interim date except:
A. The level of control risk.
B. Scheduling conflicts in the audit firm that make interim testing more convenient.
C. Whether business conditions will change after the interim date.
D. The ability to examine the remaining period.
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Education.
69. Before applying substantive procedures to the details of accounts at an interim date (a date prior to
the balance sheet date), an auditor should
A. Assess control risk at high for the assertions embodied in the accounts selected for interim testing.
B. Determine that the accounts selected for interim testing are not material to the financial statements
taken as a whole.
C. Consider the availability of information at a later date that will be necessary for the auditor's
procedures (e.g., electronic data).
D. Obtain written representations from management that all financial records and related data will be
made available.
70. A high detection risk strategy includes all of the following except:
A. Interim testing.
B. Reduced testing of transactions.
C. Heavy reliance on analytical procedures as substantive procedures.
D. Audit work only completed at year-end.
71. The auditor should consider all of the following when deciding whether substantive procedures will be
performed at an interim date except:
A. The level of control risk.
B. Scheduling conflicts in the audit firm that make interim testing more convenient.
C. Whether business conditions will change after the interim date.
D. The ability to examine the remaining period.
6-20
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Education.
72. If auditors conduct substantive procedures as of 10/31 for an entity with a 12/31 year-end
A. Additional tests are seldom conducted for the remaining period.
B. Additional control tests are required in the remaining period.
C. The entity's controls likely are ineffective.
D. Additional tests likely will be performed in the remaining period.
73. Based on a study and evaluation completed at an interim date, the auditor concludes that no
significant internal control weaknesses exist. The records and procedures would most likely be tested
again at year-end if
A. Compliance tests were not performed by the internal audit staff during the remaining period.
B. The internal control system provides a basis for reliance in reducing the extent of substantive
procedures.
C. The auditor used nonstatistical sampling during interim compliance testing.
D. Inquiries and observations lead the auditor to believe that conditions within the internal control
system have changed.
74. The auditor's communication of material weaknesses in internal control for a nonpublic company is
A. Required to enable the auditor to state that the examination has been made in accordance with
generally accepted auditing standards.
B. The principle reason for studying and evaluating the system of internal controls.
C. Incidental to the auditor's objective of forming an opinion as to the fair presentation of the financial
statements.
D. Required to be included as part of the audit opinion.
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Education.
72. If auditors conduct substantive procedures as of 10/31 for an entity with a 12/31 year-end
A. Additional tests are seldom conducted for the remaining period.
B. Additional control tests are required in the remaining period.
C. The entity's controls likely are ineffective.
D. Additional tests likely will be performed in the remaining period.
73. Based on a study and evaluation completed at an interim date, the auditor concludes that no
significant internal control weaknesses exist. The records and procedures would most likely be tested
again at year-end if
A. Compliance tests were not performed by the internal audit staff during the remaining period.
B. The internal control system provides a basis for reliance in reducing the extent of substantive
procedures.
C. The auditor used nonstatistical sampling during interim compliance testing.
D. Inquiries and observations lead the auditor to believe that conditions within the internal control
system have changed.
74. The auditor's communication of material weaknesses in internal control for a nonpublic company is
A. Required to enable the auditor to state that the examination has been made in accordance with
generally accepted auditing standards.
B. The principle reason for studying and evaluating the system of internal controls.
C. Incidental to the auditor's objective of forming an opinion as to the fair presentation of the financial
statements.
D. Required to be included as part of the audit opinion.
Exploring the Variety of Random
Documents with Different Content
Documents with Different Content
public good. In politics he was democratic, and greatly relied upon
by the Presidents Jefferson, Madison, and Monroe. He was one of
the last of the revolutionary stock that served in the Senate—
remaining there until 1833—above fifty years after that Declaration
of Independence which he had helped to make good, with his
sword. Almost octogenarian, he was fresh and vigorous to the last,
and among the most assiduous and deserving members. He had
acquired military reputation in the war of the Revolution, and was
called by his fellow-citizens to take command of the local troops for
the defence of Baltimore, when threatened by the British under
General Ross, in 1814—and commanded successfully—with the
judgment of age and the fire of youth. At his death, his fellow-
citizens of Baltimore erected a monument to his memory—well due
to him as one of her longest and most respected inhabitants, as
having been one of her eminent merchants, often her representative
in Congress, besides being senator; as having defended her both in
the war of the Revolution and in that of 1812; and as having made
her welfare and prosperity a special object of his care in all the
situations of his life, both public and private.
by the Presidents Jefferson, Madison, and Monroe. He was one of
the last of the revolutionary stock that served in the Senate—
remaining there until 1833—above fifty years after that Declaration
of Independence which he had helped to make good, with his
sword. Almost octogenarian, he was fresh and vigorous to the last,
and among the most assiduous and deserving members. He had
acquired military reputation in the war of the Revolution, and was
called by his fellow-citizens to take command of the local troops for
the defence of Baltimore, when threatened by the British under
General Ross, in 1814—and commanded successfully—with the
judgment of age and the fire of youth. At his death, his fellow-
citizens of Baltimore erected a monument to his memory—well due
to him as one of her longest and most respected inhabitants, as
having been one of her eminent merchants, often her representative
in Congress, besides being senator; as having defended her both in
the war of the Revolution and in that of 1812; and as having made
her welfare and prosperity a special object of his care in all the
situations of his life, both public and private.
CHAPTER XLVI.
SALT; THE UNIVERSALITY OF ITS SUPPLY;
MYSTERY AND INDISPENSABILITY OF ITS
USE; TYRANNY AND IMPIETY OF ITS
TAXATION; SPEECH OF MR. BENTON:
EXTRACTS.
It is probable that salt is the most abundant substance of our
globe—that it is more abundant than earth itself. Like other
necessaries of life—like air, and water, and food—it is universally
diffused, and inexhaustibly supplied. It is found in all climates, and
in a great variety of forms. The waters hold it in solution; the earth
contains it in solid masses. Every sea contains it. It is found in all the
boundless oceans which surround and penetrate the earth, and
through all their fathomless depths. Many inland seas, lakes, ponds,
and pools are impregnated with it. Streams of saline water, in
innumerable places, emerging from the bowels of the earth,
approach its surface, and either issue from it in perennial springs, or
are easily reached by wells. In the depths of the earth itself it is
found in solid masses of interminable extent. Thus inexhaustibly
abundant, and universally diffused, the wisdom and goodness of
Providence is further manifested in the cheapness and facility of the
preparation of this necessary of life, for the use of man. In all the
warm latitudes, and especially between the tropics, nature herself
performs the work. The beams of the sun evaporate the sea water in
all the low and shallow reservoirs, where it is driven by the winds, or
admitted by the art of man; and this evaporation leaves behind a
deposit of pure salt, ready for use, and costing very little more than
the labor of gathering it up. In the interior, and in the colder
latitudes, artificial heat is substituted for the beams of the sun: the
SALT; THE UNIVERSALITY OF ITS SUPPLY;
MYSTERY AND INDISPENSABILITY OF ITS
USE; TYRANNY AND IMPIETY OF ITS
TAXATION; SPEECH OF MR. BENTON:
EXTRACTS.
It is probable that salt is the most abundant substance of our
globe—that it is more abundant than earth itself. Like other
necessaries of life—like air, and water, and food—it is universally
diffused, and inexhaustibly supplied. It is found in all climates, and
in a great variety of forms. The waters hold it in solution; the earth
contains it in solid masses. Every sea contains it. It is found in all the
boundless oceans which surround and penetrate the earth, and
through all their fathomless depths. Many inland seas, lakes, ponds,
and pools are impregnated with it. Streams of saline water, in
innumerable places, emerging from the bowels of the earth,
approach its surface, and either issue from it in perennial springs, or
are easily reached by wells. In the depths of the earth itself it is
found in solid masses of interminable extent. Thus inexhaustibly
abundant, and universally diffused, the wisdom and goodness of
Providence is further manifested in the cheapness and facility of the
preparation of this necessary of life, for the use of man. In all the
warm latitudes, and especially between the tropics, nature herself
performs the work. The beams of the sun evaporate the sea water in
all the low and shallow reservoirs, where it is driven by the winds, or
admitted by the art of man; and this evaporation leaves behind a
deposit of pure salt, ready for use, and costing very little more than
the labor of gathering it up. In the interior, and in the colder
latitudes, artificial heat is substituted for the beams of the sun: the
simplest process of boiling is resorted to; and where fuel is
abundant, and especially coal, the preparation of this prime
necessary is still cheap and easy; and from six to ten cents the real
bushel may be considered as the ordinary cost of production. Such is
the bountiful and cheap supply of this article, which a beneficent
Providence has provided for us. The Supreme Ruler of the Universe
has done every thing to supply his creatures with it. Man, the
fleeting shadow of an instant, invested with his little brief authority,
has done much to deprive them of it. In all ages of the world, and in
all countries, salt has been a subject, at different periods, of heavy
taxation, and sometimes of individual or of government monopoly;
and precisely, because being an article that no man could do
without, the government was sure of its tax, and the monopolizer of
his price. Almost all nations, in some period of their history, have
suffered the separate or double infliction of a tax, and a monopoly
on its salt; and, at some period, all have freed themselves, from one
or both. At present, there remain but two countries which suffer
both evils, our America, and the British East Indies. All others have
got rid of the monopoly; many have got rid of the tax. Among
others, the very country from which we copied it, and the one above
all others least able to do without the product of the tax. England,
though loaded with debt, and taxed in every thing, is now free from
the salt tax. Since 1822, it has been totally suppressed; and this
necessary of life is now as free there as air and water. She even has
a statute to guard its price, and common law to prevent its
monopoly.
This act was passed in 1807. The common law of England
punishes all monopolizers, forestallers, and regraters. The
Parliament, in 1807, took cognizance of a reported combination to
raise the price of salt, and examined the manufacturers on oath: and
rebuked them.
Mr. B. said that a salt tax was not only politically, but morally
wrong: it was a species of impiety. Salt stood alone amidst the
productions of nature, without a rival or substitute, and the
preserver and purifier of all things. Most nations had regarded it as a
abundant, and especially coal, the preparation of this prime
necessary is still cheap and easy; and from six to ten cents the real
bushel may be considered as the ordinary cost of production. Such is
the bountiful and cheap supply of this article, which a beneficent
Providence has provided for us. The Supreme Ruler of the Universe
has done every thing to supply his creatures with it. Man, the
fleeting shadow of an instant, invested with his little brief authority,
has done much to deprive them of it. In all ages of the world, and in
all countries, salt has been a subject, at different periods, of heavy
taxation, and sometimes of individual or of government monopoly;
and precisely, because being an article that no man could do
without, the government was sure of its tax, and the monopolizer of
his price. Almost all nations, in some period of their history, have
suffered the separate or double infliction of a tax, and a monopoly
on its salt; and, at some period, all have freed themselves, from one
or both. At present, there remain but two countries which suffer
both evils, our America, and the British East Indies. All others have
got rid of the monopoly; many have got rid of the tax. Among
others, the very country from which we copied it, and the one above
all others least able to do without the product of the tax. England,
though loaded with debt, and taxed in every thing, is now free from
the salt tax. Since 1822, it has been totally suppressed; and this
necessary of life is now as free there as air and water. She even has
a statute to guard its price, and common law to prevent its
monopoly.
This act was passed in 1807. The common law of England
punishes all monopolizers, forestallers, and regraters. The
Parliament, in 1807, took cognizance of a reported combination to
raise the price of salt, and examined the manufacturers on oath: and
rebuked them.
Mr. B. said that a salt tax was not only politically, but morally
wrong: it was a species of impiety. Salt stood alone amidst the
productions of nature, without a rival or substitute, and the
preserver and purifier of all things. Most nations had regarded it as a
mystic and sacred substance. Among the heathen nations of
antiquity, and with the Jews, it was used in the religious ceremony of
the sacrifices—the head of the victim being sprinkled with salt and
water before it was offered. Among the primitive Christians, it was
the subject of Divine allusions, and the symbol of purity, of
incorruptibility, and of perpetuity. The disciples of Christ were called
"the salt of the earth;" and no language, or metaphor, could have
been more expressive of their character and mission—pure in
themselves, and an antidote to moral, as salt was to material
corruption. Among the nations of the East salt always has been, and
still is, the symbol of friendship, and the pledge of inviolable fidelity.
He that has eaten another's salt, has contracted towards his
benefactor a sacred obligation; and cannot betray or injure him
thereafter, without drawing upon himself (according to his religious
belief) the certain effects of the Divine displeasure. While many
nations have religiously regarded this substance, all have abhorred
its taxation; and this sentiment, so universal, so profound, so
inextinguishable in the human heart, is not to be overlooked by the
legislator.
Mr. B. concluded his speech with declaring implacable war against
this tax, with all its appurtenant abuses, of monopoly in one quarter
of the Union, and of undue advantages in another. He denounced it
as a tax upon the entire economy of NATURE and of ART—a tax upon
man and upon beast—upon life and upon health—upon comfort and
luxury—upon want and superfluity—upon food and upon raiment—
on washing, and on cleanliness. He called it a heartless and tyrant
tax, as inexorable as it was omnipotent and omnipresent; a tax
which no economy could avoid—no poverty could shun—no privation
escape—no cunning elude—no force resist—no dexterity avert—no
curses repulse—no prayers could deprecate. It was a tax which
invaded the entire dominion of human operations, falling with its
greatest weight upon the most helpless, and the most meritorious;
and depriving the nation of benefits infinitely transcending in value,
the amount of its own product. I devote myself, said Mr. B., to the
extirpation of this odious tax, and its still more odious progeny—the
antiquity, and with the Jews, it was used in the religious ceremony of
the sacrifices—the head of the victim being sprinkled with salt and
water before it was offered. Among the primitive Christians, it was
the subject of Divine allusions, and the symbol of purity, of
incorruptibility, and of perpetuity. The disciples of Christ were called
"the salt of the earth;" and no language, or metaphor, could have
been more expressive of their character and mission—pure in
themselves, and an antidote to moral, as salt was to material
corruption. Among the nations of the East salt always has been, and
still is, the symbol of friendship, and the pledge of inviolable fidelity.
He that has eaten another's salt, has contracted towards his
benefactor a sacred obligation; and cannot betray or injure him
thereafter, without drawing upon himself (according to his religious
belief) the certain effects of the Divine displeasure. While many
nations have religiously regarded this substance, all have abhorred
its taxation; and this sentiment, so universal, so profound, so
inextinguishable in the human heart, is not to be overlooked by the
legislator.
Mr. B. concluded his speech with declaring implacable war against
this tax, with all its appurtenant abuses, of monopoly in one quarter
of the Union, and of undue advantages in another. He denounced it
as a tax upon the entire economy of NATURE and of ART—a tax upon
man and upon beast—upon life and upon health—upon comfort and
luxury—upon want and superfluity—upon food and upon raiment—
on washing, and on cleanliness. He called it a heartless and tyrant
tax, as inexorable as it was omnipotent and omnipresent; a tax
which no economy could avoid—no poverty could shun—no privation
escape—no cunning elude—no force resist—no dexterity avert—no
curses repulse—no prayers could deprecate. It was a tax which
invaded the entire dominion of human operations, falling with its
greatest weight upon the most helpless, and the most meritorious;
and depriving the nation of benefits infinitely transcending in value,
the amount of its own product. I devote myself, said Mr. B., to the
extirpation of this odious tax, and its still more odious progeny—the
salt monopoly of the West. I war against them while they exist, and
while I remain on this floor. Twelve years have passed away—two
years more than the siege of Troy lasted—since I began this contest.
Nothing disheartened by so many defeats, in so long a time, I
prosecute the war with unabated vigor; and, relying upon the
goodness of the cause, firmly calculate upon ultimate and final
success.
while I remain on this floor. Twelve years have passed away—two
years more than the siege of Troy lasted—since I began this contest.
Nothing disheartened by so many defeats, in so long a time, I
prosecute the war with unabated vigor; and, relying upon the
goodness of the cause, firmly calculate upon ultimate and final
success.
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